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Question
A trustee for a company that is being liquidated voids a preference transfer. What has occured? Why did the trustee take this action?
Solution
VerifiedAnswered 1 year ago
Answered 1 year ago
If the company was already insolvent, the transfers made within 90 days prior to filing the bankruptcy petition can be nullified by the trustee. There is an order of priority on who will be paid first when a company is being liquidated that's why the preference transfer is void.
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